Stoozing: 0% card maxed out - what next?

Pmarmalade

I've maxed out my 0% purchases card and the 0% period is coming to an end in Jan. I paid into my ISA for the first part of the year then into an instant access savings account so I can pay off the card from the latter in Jan.

I also have a card with a £1k limit and a fantastic 8.9% rate and I don't really want to cancel that one and I know I shouldn't cancel the 0% card in case any payments sneak through after I've stopped using it. So I have £5.6k available credit already. My salary has gone up £3.5k since I applied for the 0% card though.

Obviously stoozing is more profitable than a cashback card but I'm worried I will be rejected or only given a low limit on another 0% card considering my available credit. On a cashback card I'd only need a £500-£1k monthly limit. :undecided Thoughts?

Eonel

My first thought is to be a bit careful how you use your ISA account. You are a stoozer/saver & the biggest tax-free benefit of an ISA come from long term savings & building up successive years of allowance.

I am just a bit worried that in later years you may regret putting short term stoozes through your ISA if you could have used it for real savings.

Re: getting a second credit card, it will (in part) depend on your salary and credit ratio which you have not been 100% clear on.

If you have not applied for any other new credit recently then go ahead & make the application for the 0% card and see if/what balance they offer. A single credit search will not harm your credit record too much.

Pmarmalade

Thanks for the reply. No need to worry about my ISA usage though - as mentioned previously I have been putting money into an easy access savings account since the summer and have enough in that to pay off the credit card The money saved in the ISA will be untouched and I'll transfer it next year.

My credit history is pretty good - I've had car loans over the years and never missed any payments and have had no late or missed payments on my credit card. I'm not a homeowner though and I have moved about from rental property to rental property quite a lot. I am on the electoral register also.

CLAPTON

why is stoozing better than a cash back card?

Pmarmalade

3.3% interest tax free on the ISA / 2.8% inc. tax on instant access vs 0.5% on a cashback card.

Yes there's more on some cards if you buy a lot of petrol (which I don't) or are prepared to use an AMEX (which I'm not as some places don't take it).

YorkshireBoy

Pmarmalade wrote: »

3.3% interest tax free on the ISA / 2.8% inc. tax on instant access vs 0.5% on a cashback card.

You've weighted that one heavily in your favour haven't you?

There are far better cashback cards than that.

Now factor in that your average savings account balance will be less than half your annual spend...assuming you spend linearly throughout the year?

Then factor in the additional admin required for a slow stooz card.

Then factor in your tax status...if you're a higher rate tax payer a 40% hit makes a difference to interest paid outside the ISA.

And I think you'll see where CLAPTON is coming from.


EDIT: You may find these calculators useful...

Slow stoozing

Cashback


2nd EDIT: What does "2.8% inc. tax" mean?...gross?...because that's 2.24% after basic rate tax and 1.68% after higher rate tax.

CLAPTON

Pmarmalade wrote: »

3.3% interest tax free on the ISA / 2.8% inc. tax on instant access vs 0.5% on a cashback card.

Yes there's more on some cards if you buy a lot of petrol (which I don't) or are prepared to use an AMEX (which I'm not as some places don't take it).

it depends upon your average balance on the card... that determines the interest saving
versa your monthly available spend that determines the cash back


so if the average balance is say 5k then 3.3% over a year will be £165

whereas if one uses the 1% cashback card for all spending and say spend 1,500 per month, then the cashback is 12 x 1,500 x 1% =180

so it depends upon the circumstances

Pmarmalade

YorkshireBoy wrote: »

You've weighted that one heavily in your favour haven't you?

I wouldn't say my favour. I didn't come here to argue, I just want to get the best return.

I'm not a higher tax earner and I'm aware the true interest on monthly saving is effectively half of the interest on the closing balance. I have overlooked that I'm not just earning interest off stoozing though and that with a cashback card I'd still be putting money away into the ISA each month and earning interest on that money. The 0% card does seem more flexible if I have an emergency though i.e. I can just put the expense on the credit card instead of dipping into savings.

I don't mind the "admin" factor at all. I quite enjoy it, in a geeky way!

YorkshireBoy wrote: »

There are far better cashback cards than that.

I was using the recommendations on the MSE page. Admittedly the Capital One has a good introductory rate but after that it's 0.5% after that as I only spend about £500/month. The AA, AMEX and Santander 123 cards are no use to me with my spending habits.

YorkshireBoy wrote: »

2nd EDIT: What does "2.8% inc. tax" mean?...gross?...because that's 2.24% after basic rate tax and 1.68% after higher rate tax.

That was meant to be before tax

YorkshireBoy

Pmarmalade wrote: »

I just want to get the best return.

Using the above calculators, and based on your spending...

0% on purchases makes you £58.71 a year (in your 2.8% gross account)

A 1% cashback card will make you £60 a year

Pmarmalade

YorkshireBoy wrote: »

Using the above calculators, and based on your spending...

0% on purchases makes you £58.71 a year (in your 2.8% gross account)

A 1% cashback card will make you £60 a year

Thanks. Which card is that?

50% of my monthly shopping is in supermarkets (half M&S, half ASDA), 25% online and 25% in bars/restaurants and retail stores.

Pmarmalade

I've looked around and these 1% cashback cards don't appear to exist without some caveats. AMEX is 1.25% but £25/year fee and not accepted in all stores. Others are biased towards petrol/supermarket shopping only.

EDIT: Just realised I don't earn over the threshold (£30k) for AMEX either.